Days payables outstanding

Days payables oustanding (DPO) is an efficiency ratio that measures the average number of days a company takes to get paid by its customers.

The formula for DPO is:

$DPO={\dfrac {ending~A/P}{COGS/day}}$

where ending A/P is the accounts payable balance at the end of the accounting period being considered and COGS/day is calculated by dividing the total cost of goods sold per year by 365 days.

See also

• Working capital analysis
• Days Sales Outstanding
• Days In Inventory